President Trump sells tax plan as ‘once-in-a-generation’ opportunity
WASHINGTON — President Donald Trump unveiled a $6 trillion tax cut that he says will primarily favor working class Americans. It’s the biggest U.S. tax overhaul in 30 years.
“This is a once-in-a-generation opportunity, and I guess it’s probably something I could say that I’m very good at,” President Trump said during remarks in Indiana. “I’ve been waiting for this for a long time. We’re going to cut taxes for the middle class, make the tax code simpler and more fair for everyday Americans. And we are going to bring back the jobs and wealth that have left our country and most people thought left our country for good.”
“Tax reform will protect low income and middle income households, not the wealthy and well-connected.”
The primary change for individuals is a simplified tax code that reduces the seven current income tax brackets to three, and would double the standard deduction for married and single filers. The plan also calls for estate tax to be eliminated among other proposals.
The GOP proposal, being presented jointly by the White House, House Ways & Means Committee and Senate Finance Committee, calls for reducing income tax rates to three brackets of 12%, 25% and 35%, but leaves the income ranges for those brackets up to tax committees, according to a copy of the Republican framework obtained by CNN.
The proposal also gives committees the flexibility to create a fourth bracket that could potentially eliminate a potential tax cut for the wealthiest Americans.
Still, while the President focused on the benefits the tax proposal would deliver to middle class Americans, he made clear it would also be a boon for big business.
Beyond slashing the corporate tax rate to “no higher than 20%,” the proposal also offers write-offs for companies that move their manufacturing plants to the US and would incentivize the repatriation of “trillions” of dollars in US companies’ profits stashed in tax havens overseas.
“Our framework will stop punishing companies for keeping their headquarters in the United States. We’re punishing companies under our codes for being in the United States,” Trump said. “When our companies move to other countries it’s our loyal American workers who get hurt.”
The business-friendly policies should lead to increased wages and economic gains in the US. The GOP framework would also cap the tax rate for small businesses at 25%, President Trump said.
The framework is the result of months of closed-door discussions between top Trump administration officials and Republican congressional leaders, but President Trump has signaled in recent weeks that he is hoping to win some Democratic support for his proposal.
But who exactly gets taxed slightly more on the bottom and slightly less up top is a big point of contention.
“A large percentage of middle class families would pay more taxes. Looking at this plan I think almost every wealthy family would get a big break,” said Senate Minority Leader Chuck Schumer.
Some analysts warn the plan could reduce government revenue by $2 trillion or more over the next ten years, adding to the nation’s $20 trillion national debt.
Republicans tout the simplicity of the new code, saying most Americans will be able to complete their entire tax filing on a single postcard. Republicans have indicated they’d like to get the plan ready for President Trump to sign off on by the end of the year.